The multi-billion dollar health and pharmaceutical company Johnson & Johnson went on trial in Oklahoma last week after the state accused the company of overproducing painkillers and contributing to the opioid epidemic that has claimed an average of 130 victims every day this year. In response to the pending litigation, the company on May 29 witnessed about a 4 percent plummet in shares.
The pharmaceutical giant has been known to survive storms over its 133-year life — from links to cancer-causing asbestos in its talcum powder to the deadly 1982 sabotaging of Tylenol capsules. In an era of formidable scrutiny over the pharmaceutical industry’s complicity in the opioid epidemic, the supplier of household staples such as baby oil and powder has continued to pour resources into lobbying and public campaigning to regain trust of both politicians and consumers alike.
Although the pharmaceutical and health products industry has won the favor of numerous legislators in years past, the tide appears to be turning. At a Senate Finance Committee hearing in February, Senators grilled Johnson & Johnson executives alongside other pharmaceutical representatives over the skyrocketing price of drugs.
The potential culture change in Congress comes as those in the pharmaceutical and health products industry contributed $16.9 million to members of the House and over $7 million to members the Senate just last year. That doesn’t include the $282 million spent on at least 1,450 registered lobbyists, making it one of the most commanding industries at the Capitol.
Oklahoma’s lawsuit follows in the stead of other attempts by city and state governments to claim settlements from big pharma, or companies with hands in the production of the notorious OxyContin painkiller, including the Sackler family’s Purdue Pharma. For its part, the Oklahoma government contends it will use what it makes in the settlement for treatment programs and resources for its residents.
This is not the first time Johnson & Johnson has battled lawsuits, accusing the company of failing to give consumers proper warnings of risks associated with their products. This year in St. Louis, a jury awarded $4.7 billion to 22 women who used Johnson & Johnson talcum powder and were later diagnosed with ovarian cancer, although the case is being appealed. A New York court followed on May 31, demanding the company pay $300 million in damages in another case related to the talcum powder.
Johnson & Johnson maintains that its products do not contain cancer-causing ingredients. “Studies of more than 100,000 men and women show that talc does not cause cancer or asbestos-related disease,” the company said in a statement.
Amid an onslaught of lawsuits, Johnson & Johnson has kept pace with its historically hefty lobbying efforts as it wrestles to maintain influence in the halls of Congress. In 2018, Johnson & Johnson devoted $6.6 million to lobbying efforts. This year, it already spent $1.46 million, far outspending Purdue Pharma’s mere $200,000 dedicated to lobbying. About 80 percent of Johnson & Johnson’s 54 registered lobbyists are revolving door lobbyists with potentially cozy ties with politicians. For instance, revolving door lobbyist Nadeam Elshami served as House Speaker Nancy Pelosi’s Chief of Staff for a decade.
Over the last few years, Johnson & Johnson has lobbied on issues relating to “civil justice reform” and “trial lawyer advertising” as the company has been hammered by class action lawsuits. House Republicans in the 115th Congress passed several bills to limit abuse of civil lawsuits — efforts supported by pro-business organizations.
This comes as other groups push for tort reform. The American Tort Reform Association, a group representing hundreds of corporations, has labeled courts that ruled against huge corporations, including the one in St. Louis, as “Judicial Hellholes.” The group has backed efforts in Missouri to make it harder to sue, but has lamented opposing lobbying efforts by associations representing trial lawyers.
Johnson & Johnson is a seasoned fighter in Washington, winning the ears of politicians over the years. And the most recent election season was no different.
Amid a bicameral effort to address the opioid epidemic, 49 Senators received a total of $152,682 in contributions from Johnson & Johnson’s PAC and its affiliates. In the House, 141 members received $469,996. Thirty seven members of Congress have shares in the company.
The company gave nearly $1.2 million in contributions in the 2018 election cycle, with 53 percent going to Republicans. Sen. Bob Casey (D-Pa.) received $19,591, the most among members of Congress. Former House Speaker Paul Ryan (R-Wis.) followed, pocketing $12,700.
But the active field of Democratic presidential contenders has been vocal about their plans to take on the culprits of the epidemic.
Presidential candidate Sen. Elizabeth Warren (D-Mass.) has not hesitated to label pharmaceutical conglomerates as malicious actors in the opioid crisis. Last month during campaign stops in West Virginia and Ohio — states with some of the highest opioid-related deaths in the nation — Warren rallied residents around her plan to bring corporate executives complicit in the epidemic accountable in the courts. “We need to hold those executives personally liable. I’m talking handcuffs and perp walks,” according to video published by The Hill. Warren’s Senate campaign received $68,262 from those in the pharmaceutical/health products industry in the 2018 cycle.
Robert Wood “Woody” Johnson IV, the Johnson & Johnson founder’s grandson, also has ties to the president, winning the coveted position as the ambassador the United Kingdom in 2017. Although the billionaire initially supported Jeb Bush in the 2016 presidential primaries, his position as a loyal Republican donor may have ingratiated him into the president’s inner circle. Johnson gave Trump’s campaign the maximum individual donation of $5,400 in 2016 and has given generously to the Republican National Committee.
The Johnson family was named one of the richest families in the world by Forbes. Alex Gorsky is the current chairman and CEO of the company. Johnson & Johnson announced $81.6 billion in sales last year. Even as the trial in Oklahoma makes headway, the company faces thousands more lawsuits over its products — from talc powder and artificial hip implants to blood thinner. Despite recent blows, the company had about a $350 billion stock market value on Wednesday.
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